April 21, 2020 by Emsi Burning Glass
While US restaurants struggle, COVID-19’s impact on grocery stores and food manufacturers has led to increased demand as millions of Americans choose to cook at home instead of eating out.
In fact, as of April 14, job postings for grocery stores are up 12% from a year ago.
In general, total US job postings are way down in the last 30 days compared to that same timeframe in 2019. But retail trade (which includes grocery stores) is one of the top posting industries right now, along with healthcare. Read about other recent job posting trends here.
We’ve seen similar patterns play out in past economic downturns. As people face financial uncertainty, they typically spend less on restaurants and more on groceries. During the Great Recession, food-away-from-home (restaurants) spending decreased 11.5% between 2006 and 2009, according to the USDA Economic Research Service. Meanwhile, food-at-home spending increased from 2007 to 2008 and then dropped in 2009 as consumers tightened their spending even more.
The same is true for consumers now during COVID-19. In addition to financial constraints, restaurant closures and stay-home orders make it even less likely that consumers will buy food at restaurants. This is a double whammy for the restaurant industry, but the positive is COVID-19’s impact on grocery stores and food manufacturers.
*Note: In this article, “grocery stores” refers to the Supermarkets and Other Grocery (Except Convenience) Stores industry (NAICS 445110). Food Manufacturers includes all Food Manufacturing (NAICS 311) sub sectors, except for Animal Food Manufacturing (NAICS 3111).
From 2007 to 2008, many major food retailers and manufacturers saw an increase in sales/revenue. This includes PepsiCo (10%), Costco (12.5%), Nestle (8.3%), Campbell’s Soup (8.3%), Walmart (8%), Kroger (6.4%), and Safeway (4.3%).
You’ll see Kroger and Safeway among the top 10 grocery stores in growth mode right now. All of these stores have posted at least 1,000 jobs in the last 30 days. It’s also worth noting the huge percent changes for some of these stores’ job postings from March 2019 to March 2020—particularly Save Mart Supermarkets (636%) and Aldi (200%).
Below are the top 10 occupations these grocery stores are posting for. We can see that front-line workers like retail salespersons and cashiers have increased in demand over the last 30 days. And while demand for stock clerks has slightly decreased in that same time frame, there are still over 12,500 job postings for these workers—an 18% increase from March 2019.
Below, we can see the top 10 growing food manufacturing companies that have posted at least 750 jobs in the last 30 days. Again, note the large percent changes between March 2019 and March 2020 for the top three companies.
COVID-19 is not only impacting job posting behavior for grocery stores and food manufacturers, but it’s also changing which products these industries are focusing on. Litehouse Foods, an Idaho-based food manufacturer known for salad dressings, has seen this first hand.
With restaurants all over the country now closed or offering only drive-thru, takeout, or delivery, Litehouse has seen consumer demand shift to their retail items, especially their core creamy dressing line. They’ve also seen an increase in demand for salad kits and ready-to-eat meals that include Litehouse sauce or dressing.
“We believe consumers are continuing to look for better-for-you options while also trying to find convenient items to keep on hand,” said Kelly Prior, Litehouse President and CEO.
COVID-19 is also changing the way American consumers shop for groceries. Online grocery shopping has exploded, sending downloads for grocery pickup apps like Walmart’s through the roof. Grocery delivery company Instacart is also working to meet increased demand, posting over 3,700 jobs in the last 30 days (a 120% increase).
Prior said Litehouse is working with Instacart on a free delivery initiative. This not only incentivizes consumers to do their grocery shopping from home, but also helps retailers keep in-store shoppers to a minimum during this time of social distancing.
While many US industries are struggling due to COVID-19, grocery stores and food manufacturers are seeing increased demand. And if past trends are any indication, these industries will continue to see solid sales as consumers shift from eating out to eating at home. COVID-19’s impact on grocery stores and food manufacturers includes increased demand in manufacturing, and talent.
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